Social Warfare keeps Johann Rupert awake at night

Written by Ben MorkenTuesday, 16 June 2015

Recent comments by South Africa’s most powerful business tycoon, Johann Rupert, gives interesting and penetrating insights into the current state of mind of the bourgeoisie. Rupert is clearly very disturbed by the current state of affairs, even admitting that they are keeping him awake at night.

In a recent speech at the Financial Times Business of Luxury Summit in Monaco, a gathering for senior executives of the luxury goods industry, he said tension between the rich and the poor is set to escalate as robots and artificial intelligence fuel mass unemployment. “We cannot have 0.1 percent of 0.1 percent taking all the spoils,” he said to his fellow bourgeois friends surrounded by $130 million yachts, Macallan whiskey and Almas caviar.

He proceeded to ask his audience a loaded question: “How is society going to cope with the structural unemployment and the envy, hatred and social warfare?” This shows that Rupert has a clear grasp of the crisis his system is facing. The capitalist system has long ago ceased to be a progressive system, it now staggers along at an appalling cost to society. One of the key manifestations of this is the phenomenon of organic, structural mass unemployment which in South Africa officially stands at 25 percent. Rupert understands that this is a clear recipe for class struggle, and he admits that this is giving him sleepless nights: “We are destroying the middle classes at this stage and it will affect us. It’s unfair. So that’s what keeps me awake at night.”

He said that conflicts between social classes will make selling luxury goods more tricky as the rich will want to conceal their wealth. On this point, the Financial Times chipped in to give the rulers of our world some amusing advice: “Perhaps discretion will be in more demand: minimalist jewellery instead of bling; Audis instead of Ferraris; silver watches instead of gold chronometers. A yacht is hard to disguise, but it can be sailed out of sight of public beaches.” But it is unclear how wealth is to be concealed in a country like South Africa where the class divisions are so glaring that they are evident to the naked eye. Rich and poor literally stare each other in the face every day and both are disgusted at what they see. Rupert concluded his speech by giving his audience some disturbing advice: “We are in for a huge change in society. Get used to it. And be prepared.”

Johann Rupert knows a thing or two about “disturbing” changes in society from a bourgeois perspective. Together with the Oppenheimer family, the Ruperts were at the heart of efforts to quell the revolutionary events of the 1980s and 1990s in South Africa, which nearly overthrew their entire system. In the end they were prepared to give all democratic rights to the masses as long as Capitalism as a whole was maintained.

Rupert knows the bourgeoisie intimately well. He is the chairman and chief executive officer of the Swiss luxury goods company Compagnie Financiere Richemont, which manufactures and sells jewellery, watches, leather goods, writing instruments, and menas and women’s clothes to the richest people on Earth. Their most famous brands include Cartier, IWC International Watch Co. AG, Jaeger-LeCoultre and Montblanc. Rupert also serves as Non-Executive Chair of VenFin and Remgro Ltd.

Johann Rupert can clearly hear the alarm bells going off. A few months back, he berated South Africa’s government for failing to address corruption and electricity shortages: “The leadership of this country, quite frankly, is becoming very, very hard to defend abroad,” Rupert told Remgro’s annual general meeting in Somerset West, near Cape Town. “The people who are running the country now were not given proper education [!]. Wherever you look we have got stagnation and really worrying signs.” Of course, this is rich coming from Rupert. The corruption which he is complaining about is of the bourgeoisie’s own doing. In their endeavour to stabilise South African Capitalism after the fall of the Apartheid regime, corruption as a means of controlling the new political elite and tying them to the bourgeoisie, was one of the main tools used by the ruling class. The problem now is that this has reached epidemic proportions. In the context of a sharp rise in the class struggle, the daily revelations about corruption which involves some of the most senior ANC leaders, including the Nkandla scandal which involves the president himself, is becoming a major cause for instability by enraging the tested South African masses.

At the same meeting in Somerset West, Rupert also had some gloomy news regarding the global economy. Asked by a shareholder about the company’s prospects, Rupert said the global economic outlook “is not looking too rosy”: “It doesn’t really matter who you listen to, whether it’s the IMF or whosoever, they are petrified,” he said. “The only way to get out of this is economic growth. I see nothing on the horizon to pull Europe out of its malaise.

These comments, by one of South Africa’s most influential bourgeois, strikingly confirms that some of the rulers of our world are deeply concerned about the state of their system. Some of them are overcome with a sense of dread and foreboding. Everywhere they look, they are confronted with a deep malaise in society. As a South African bourgeois, Johann Rupert can see nothing but trouble ahead. Recently he recalled author Ernest Hemingway’s quote that “man goes bust gradually … and then suddenly”. He believes South Africa was in the gradual stage, but the “sudden stage” could come at any time. It is not exactly clear whether or not Rupert knows it, but it is actually a profound dialectical quote, although from a deeply pessimistic point of view.

Johann Rupert only sees doom and gloom. But the bourgeois has every reason to dread the future. More than two decades ago the revolutionary South African proletariat came within a hair’s breadth of overthrowing capitalism. Only the lack of a revolutionary leadership prevented them from doing so. But today, the bourgeois faces a massive dilemma: whereas the ANC leaders of the past had enormous stature and authority, today’s leaders have very little of both. It would be very difficult for the current leaders to hold the masses back once they move to change society.

The capitalist system is in the middle of its deepest crisis ever, and it is global. Together with this, come roaring revolutionary mass movements from Egypt, Turkey, Brazil and Burkina Faso. On the other hand, Marxists look to the future with enormous optimism. Where the Johann Ruperts of the world are petrified by the advance of modern technologies like robots, Marxists welcome technological advances wholeheartedly. Under Capitalism advances in technology are solely aimed at improving the rate of profit and the bottom line. But under socialism, robots and other technologies will be used solely for human advances and needs. It would be a terrible mistake to believe that the ruling class will give up their position in society without a desperate fight to the finish. They will fight, claw and scratch to keep their privileges, interests and positions as the ruling class of society.

Monopoly Monetary Elite Man

But all of their attempts would be no match for the strength of the workers and poor once they start to move. It is not the sudden “going bust” of mankind that Ruperts is prophesising, but the doom of his own class which is terrified by its own impotence in the face of the rising class struggle.

Local doctors are in the eye of a storm swirling for the past three years over whether corn that’s been genetically modified to resist pesticides is a source of prosperity, as companies claim, or of birth defects and illnesses

Pediatrician Carla Nelson remembers catching sight of the unusually pale newborn, then hearing an abnormal heartbeat through the stethoscope and thinking that something was terribly wrong.

The baby was born minutes before with a severe heart malformation that would require complex surgery. What worried her as she waited for the ambulance plane to take the infant from Waimea, on the island of Kauai, to the main children’s hospital in Honolulu, on another Hawaiian island, was that it was the fourth one shehad seen in three years.

In all of Waimea, there have been at least nine in five years, she says, shaking her head. That’s more than 10 times the national rate, according to analysis by local doctors.

Nelson, a Californian, and other local doctors find themselves in the eye of a storm swirling for the past three years around the Hawaiian archipelago over whether a major cash crop on four of the six main islands, corn that’s been genetically modified to resist pesticides, is a source of prosperity, as the companies claim – or of birth defects and illnesses, as the doctors and many others suspect.

After four separate attempts to rein in the companies over the past two years all failed, an estimated 10,000 people marched on 9 August through Honolulu’s Waikiki tourist district. Some held signs like, “We Deserve the Right to Know: Stop Poisoning Paradise” and “Save Hawaii – Stop GMOs” (Genetically Modified Organisms), while others protested different issues.

Pesticides Legality Protested in Waimea Hawaii near schools and hospital.

“The turnout and the number of groups marching showed how many people are very frustrated with the situation,” says native Hawaiian activist Walter Ritte of the island of Molokai.

Waimea, a small town of low, pastel wood houses built in south-west Kauai for plantation workers in the 19th century, now sustains its economy mostly from a trickle of tourists on their way to a spectacular canyon. Perhaps 200 people work full-time for the four giant chemical companies that grow the corn – all of it exported – on some 12,000 acres leased mostly from the state.
In Kauai, chemical companies Dow, BASF, Syngenta and DuPont spray 17 times more pesticide per acre (mostly herbicides, along with insecticides and fungicides) than on ordinary cornfields in the US mainland, according to the most detailed study of the sector, by the Center for Food Safety.

That’s because they are precisely testing the strain’s resistance to herbicides that kill other plants. About a fourth of the total are called Restricted Use Pesticides because of their harmfulness. Just in Kauai, 18 tons – mostly atrazine, paraquat (both banned in Europe) and chlorpyrifos – were applied in 2012. The World Health Organization this year announced that glyphosate, sold as Roundup, the most common of the non-restricted herbicides, is “probably carcinogenic in humans”.

The cornfields lie above Waimea as the land, developed in the 1870s for the Kekaha Sugar Company plantation, slopes gently up toward arid, craggy hilltops. Most fields are reddish-brown and perfectly furrowed. Some parts are bright green: that’s when the corn is actually grown.

Both parts are sprayed frequently, sometimes every couple of days. Most of the fields lie fallow at any given time as they await the next crop, but they are still sprayed with pesticides to keep anything from growing. “To grow either seed crops or test crops, you need soil that’s essentially sterile,” says professor Hector Valenzuela of the University of Hawaii department of tropical plant and soil science.

When the spraying is underway and the wind blows downhill from the fields to the town – a time no spraying should occur – residents complain of stinging eyes, headaches and vomiting.

“Your eyes and lungs hurt, you feel dizzy and nauseous. It’s awful,” says middle school special education teacher Howard Hurst, who was present at two evacuations. “Here, 10% of the students get special-ed services, but the state average is 6.3%,” he says. “It’s hard to think the pesticides don’t play a role.”

At these times, many crowd the waiting rooms of the town’s main hospital, which was run until recently by Dow AgroSciences’ former chief lobbyist in Honolulu. It lies beside the middle school, both 1,700ft from Syngenta fields. The hospital, built by the old sugar plantation, has never studied the effects of the pesticides on its patients.

The chemical companies that grow the corn in land previously used for sugar refuse to disclose with any precision which chemicals they use, where and in what amounts, but they insist the pesticides are safe, and most state and local politicians concur. “The Hawai‘i legislature has never given the slightest indication that it intended to regulate genetically engineered crops,” wrote lawyer Paul Achitoff of Earthjustice in a recent court case.

As for the birth defects spike, “We have not seen any credible source of statistical health information to support the claims,” said Bennette Misalucha, executive director of Hawaii Crop Improvement Association, the chemical companies trade association, in a written statement distributed by a publicist. She declined to be interviewed.

Nelson, the pediatrician, points out that American Academy of Pediatrics’ report, Pesticide Exposure in Children, found “an association between pesticides and adverse birth outcomes, including physical birth defects”. Noting that local schools have been evacuated twice and children sent to hospital because of pesticide drift, Nelson says doctors need prior disclosure of sprayings: “It’s hard to treat a child when you don’t know which chemical he’s been exposed to.”

Her concerns and those of most of her colleagues have grown as the chemical companies doubled to 25,000 acres in a decade the area in Hawaii they devote to growing new varieties of herbicide-resistant corn.

Today, about 90% of industrial GMO corn grown in the US was originally developed in Hawaii, with the island of Kauai hosting the biggest area. The balmy weather yields three crops a year instead of one, allowing the companies to bring a new strain to market in a third of the time.

Once it’s ready, the same fields are used to raise seed corn, which is sent to contract farms on the mainland. It is their output, called by critics a pesticide delivery system, that is sold to the US farmers, along with the pesticides manufactured by the breeder that each strain has been modified to tolerate.

Corn’s uses are as industrial as its cultivation: less than 1% is eaten. About 40% is turned into ethanol for cars, 36% becomes cattle feed, 10% is used by the food industry and the rest is exported.

At a Starbucks just outside Honolulu, Sidney Johnson, a pediatric surgeon at the Kapiolani Medical Center for Women and Children who oversees all children born in Hawaii with major birth defects and operates on many, says he’s been thinking about pesticides a lot lately. The reason: he’s noticed that the number of babies born here with their abdominal organs outside, a rare condition known as gastroschisis, has grown from three a year in the 1980s to about a dozen now.

“We have cleanest water and air in the world,” he says. So he’s working with a medical student on a study of his hospital’s records to determine whether the parents of the gastroschisis infants were living near fields that were being sprayed around the time of conception and early pregnancy. He plans to extend the study to parents of babies suffering from heart defects.

“You kind of wonder why this wasn’t done before,” he says. “Data from other states show there might be a link, and Hawaii might be the best place to prove it.”

Unbeknownst to Johnson, another two physicians have been heading in the same direction, but with some constraints. They’re members of a state-county commission appointed this year to “determine if there are human harms coming from these pesticides”, as its chairman, a professional facilitator named Peter Adler, tells a meeting of angry local residents in Waimea earlier this month. Several express skepticism that the panel is anything but another exercise in obfuscation.

The panel of nine part-time volunteers also includes two scientists from the chemical companies and several of their critics. “We just want to gather information and make some recommendations,” Adler tells the crowd of about 60 people. “We won’t be doing any original research.”

But one of the two doctors, a retired pediatrician named Lee Evslin, plans to do just that. “I want see if any health trends stand out among people that might have been exposed to pesticides,” he says in an interview. “It won’t be a full epidemiological study, but it will probably be more complete than anything that’s been done before.”

The panel itself, called the Joint Fact-Finding Study Group on Genetically Modified Crops and Pesticides on Kauaʻi, is the only achievement of three years of failed attempts to force the companies to disclose in advance what they spray and to create buffer zones – which they do in 11 other states, where food crops receive much less pesticides per acre.

The pushback from the expansion of the GMO acreage first emerged when Gary Hooser of Kauai, a former state senate majority leader who failed in a bid for lieutenant governor in 2010, ran for his old seat on the Kauai County council in 2012.

“Everywhere I went, people were concerned about GMOs and pesticides. They were saying, ‘Gary, we gotta do something’,” he recounts over coffee at the trendy Ha Coffee Bar in Lihue, the island’s capital. “Some were worried about the GMO process itself and others by the threats of the pesticides, and it became one of the dominant political issues.”

Protest against dumping toxin on Hawaii farms

Once elected, Hooser, who has a ruddy complexion, piercing blue eyes and arrived in Hawaii as a teenager from California, approached the companies for information about exactly what they were spraying and in what amounts. He was rebuffed.

In the process of what he called “doing my homework”, he discovered that the companies, unlike regular farmers, were operating under a decades-old Environmental Protection Agency permit to discharge toxic chemicals in water that had been grandfathered from the days of the sugar plantation, when the amounts and toxicities of pesticides were much lower. The state has asked for a federal exemption for the companies so they can avoid modern standards of compliance.

He also found that the companies, unlike regular farmers, don’t pay the 4% state excise tax. Some weren’t even asked to pay property taxes, worth $125,000 a year. After pressure from Hooser and the county tax office, the companies paid two years’ worth of back taxes.

So with the backing of three other members of the seven-member Kauai council, he drafted a law requiring the companies to disclose yearly what they had grown and where, and to announce in advance which pesticides they proposed to spray, where and when. The law initially also imposed a moratorium on the chemical companies expanding their acreage while their environmental impact was assessed.

After a series of hearings packed by company employees and their families wearing blue and opponents wearing red, the bill was watered down by eliminating the moratorium and reducing the scope of the environmental study. The ordinance then passed, but the companies sued in federal court, where a judge ruled that the state’s law on pesticides precluded the counties from regulating them. After the ruling, the state and the county created the joint fact-finding panel officially committed to conducting no new research.

Hooser is confident the ruling will be overturned on appeal: the Hawaii constitution “specifically requires” the state and the counties to protect the communities and their environment.

In his appeal, Achitoff of Earthjustice argued that Hawaii’s general pesticide law does not “demonstrate that the legislature intended to force the county to sit and watch while its schoolchildren are being sent to the hospital so long as state agencies do not remedy the problem.”

In the Big Island, which is called Hawaii and hosts no GMO corn, a similar process unfolded later in 2013: the county council passed a law that effectively banned the chemical companies from moving in, and it was struck down in federal court for the same reasons. A ban on genetically modified taro, a food root deemed sacred in Hawaiian mythology, was allowed to stand.

In Maui County, which includes the islands of Maui and Molokai, both with large GMO corn fields, a group of residents calling themselves the Shaka Movement sidestepped the company-friendly council and launched a ballot initiative that called for a moratorium on all GMO farming until a full environmental impact statement is completed there.

The companies, primarily Monsanto, spent $7.2m on the campaign ($327.95 per “no” vote, reported to be the most expensive political campaign in Hawaii history) and still lost.

Again, they sued in federal court, and, a judge found that the Maui County initiative was preempted by federal law. Those rulings are also being appealed.

In the state legislature in Honolulu, Senator Josh Green, a Democrat who then chaired the health committee, earlier this year attempted a fourth effort at curbing the pesticide spraying.

In the legislature, he said, it’s an open secret that most heads of the agriculture committee have had “a closer relationship with the agro-chemical companies than with the environmental groups”.

Green, an emergency room doctor who was raised in Pennsylvania, drafted legislation to mandate some prior disclosure and some buffer zones. “I thought that was a reasonable compromise,” he says. Still, he also drafted a weaker bill as a failsafe. “If even that one doesn’t pass, it’s going to be obvious that the state doesn’t have the political will to stand up to the chemical companies,” he said in a phone interview at the time. “That would be terrible.”

The chairman of the senate agricultural committee, Cliff Tsuji, didn’t even bring the weaker bill to a vote, even though Hawaii’s governor had pledged to sign any bill that created buffer zones.

Asked by email what he would do now, Green replied with a quip: “Drink scotch.”

This report was supported by a grant from the Fund for Investigative Journalism.